Palm Oil

Background

Palm oil is a high-yielding, land-efficient crop that can contribute to economic development and poverty alleviation in many emerging markets when responsibly produced. However, rapid expansion of palm oil plantations is threatening environmentally sensitive areas of tropical rainforest and carbon-rich peatlands, as well as the rights of communities that depend on those forests and lands for their livelihoods. Labor violations have been found on some palm oil plantations.

Small amounts of palm oil are present in many of our products. We are committed to protecting forests and biodiversity, minimizing the carbon footprint of our supply chain and respecting the rights of affected communities and workers.

Mars is a member of the Roundtable on Sustainable Palm Oil (RSPO) and, as of year-end 2013, we purchase 100 percent of our palm oil from RSPO-certified sources via the “mass balance” program. We achieved this two years ahead of our original goal to source 100 percent of palm oil from certified sources by year-end 2015.

The mass balance model requires processors to purchase palm oil from certified sources, but allows them to mix it with conventional palm oil during transportation, processing and packaging. This reduces the cost and complexity of handling separate supply chains and fosters greater uptake of certification.

This means that while enough certified palm oil enters the supply chain to cover our needs, some of the palm oil we actually receive today will come from unknown and non-certified sources.

We will continue to source 100% RSPO mass-balance certified palm oil, but we are now strengthening our commitment as follows to ensure this palm oil is genuinely sustainable:

Our ambition is to go beyond the RSPO criteria to only source palm oil from companies whose operations meet the following sourcing charter, within the timeframe described below:

Only from legal sources

No development in areas of high conservation value*

No development in high carbon stock forest areas*

No development on peat lands regardless of depth

No burning to clear land for new developments or to re-plant existing developments

Compliance with the Mars, Incorporated Supplier Code of Conduct. This sets our expectations in the areas of child labor, forced labor, discrimination, compensation and benefits, working hours, freedom of association and right to collective bargaining, health and safety, the environment and ethical business practices.

Respect the right of all affected communities to give or withhold their free, prior and informed consent for plantation developments on land they own legally, communally or by custom

Support farmers and plantation owners to comply with this policy.

We will develop a fully traceable pipeline back to known mills by year-end 2014. We will then work with the Forest Trust (TFT) to ensure these mills can verify that their fresh-fruit bunch supply, including supply from smallholders, meets our sourcing charter. We require all suppliers to comply with our charter by year-end 2015, or to have plans in place by year-end 2015 to ensure compliance.

We will only work with palm oil suppliers that share our values and our commitment to transforming the palm oil supply chain, and we will require that by the end of 2014 they confirm their commitment to comply with the above sourcing charter.

These measures will help ensure a genuinely sustainable pipeline where all material is sourced from companies whose mills only produce sustainable palm oil.

In addition, we believe that this will help accelerate change by encouraging our suppliers to source all their palm oil from companies whose plantations and farms are responsibly run.

Our annual Principles in Action Summary will report on our progress and we will provide updates as appropriate on our website.

Mars will partner with industry, governments and civil society on broader efforts to protect forests and ensure mutual benefits for the workers and communities that rely on them for their livelihoods. In particular, we will work with the Consumer Goods Forum to speed progress on preventing deforestation.

Palm Oil: Why is it important?
Strategy 1: Source 100% palm oil for our chocolate, candy and gum through RSPO’s mass balance program
Target: 100% from certified sources by 2015
Issue
Palm oil h=is a high-yielding, land-efficient crop and an important raw material for the food industry. Its production contributes to economic development in many emerging markets. High demand has led to the rapid expansion of palm oil plantations, often in environmentally sensitive areas.
Statistics
1000: Number of RSPO members across 50 states